Snap(US:SNAP)2024-10-29 23:42Financial Performance - Net loss for the three months ended September 30, 2023, was $153.247 million, compared to a net loss of $368.256 million for the nine months ended September 30, 2023[21]. - Revenue for Q3 2024 was $1,372,574, a 15.5% increase from $1,188,551 in Q3 2023[23]. - Net loss for Q3 2024 was $153,247, compared to a net loss of $368,256 in Q3 2023, representing a 58.5% improvement[25]. - Operating loss decreased to $173,210 in Q3 2024 from $380,063 in Q3 2023, showing a 54.4% reduction[23]. - Total costs and expenses for Q3 2024 were $1,545,784, down from $1,568,614 in Q3 2023, a decrease of 1.5%[23]. - Basic net loss per share for Q3 2024 was $(0.09), an improvement from $(0.23) in Q3 2023[23]. - Adjusted EBITDA for Q3 2024 was $132.0 million, compared to $40.1 million in the same period last year[129]. - Free Cash Flow improved to $71.8 million, compared to a negative $60.7 million in Q3 2023[130]. - The increase in revenue was primarily driven by growth in advertisers and higher subscription revenue due to an increase in the number of subscribers[162]. - The company anticipates continued growth in revenue driven by optimization efficiencies and improvements in auction-based advertising demand[162]. Cash Flow and Liquidity - Cash flows from operating activities provided $115.872 million for the three months ended September 30, 2023, compared to $12.781 million for the nine months ended September 30, 2023[21]. - Cash, cash equivalents, and restricted cash at the end of the period were $968.393 million, down from $1.065 billion at the beginning of the period[21]. - Cash and cash equivalents decreased to $964,967 as of September 30, 2024, from $1,780,400 at the end of 2023[26]. - As of September 30, 2024, the company held $3.2 billion in cash, cash equivalents, and marketable securities[130]. - The company believes its existing cash balance is sufficient to fund ongoing working capital and investment requirements for at least the next 12 months[189]. User Metrics - Average Daily Active Users (DAUs) are calculated by adding the number of DAUs for each day of the quarter and dividing by the number of days in that quarter[14]. - Daily Active Users (DAUs) reached 443 million, reflecting a 9% year-over-year growth[128]. - Average Revenue Per User (ARPU) increased to $3.10, up from $2.93 in the prior year[128]. Expenses and Costs - Depreciation and amortization for the three months ended September 30, 2023, was $38.850 million, with stock-based compensation totaling $260.229 million[21]. - Research and development expenses for Q3 2024 were $412,791, down from $494,559 in Q3 2023, a decrease of 16.5%[23]. - Sales and marketing expenses for the three months ended September 30, 2024, were $273,107 thousand, an 8% decrease from $297,251 thousand in the same period of 2023[165]. - General and administrative expenses for the three months ended September 30, 2024, were $220,979 thousand, nearly unchanged from $221,051 thousand in the same period of 2023[166]. Investments and Acquisitions - The total purchase consideration for business acquisitions in 2023 was $73.1 million, including $56.3 million in cash and $12.6 million in other liabilities, with $42.8 million allocated to goodwill[58]. - As of September 30, 2024, the carrying amount of goodwill increased to $1,693.946 million, reflecting a foreign currency translation adjustment of $2.119 million[59]. - The total intangible assets as of September 30, 2024 amounted to $361.451 million, with a net value of $98.920 million after accumulated amortization of $262.531 million[61]. Debt and Financing - In May 2024, the company issued $750.0 million in convertible senior notes due in 2030, with net proceeds of $671.5 million after costs[63]. - The company repurchased $100.0 million of the 2025 Notes and $351.2 million of the 2026 Notes for a total cash price of $440.7 million, resulting in an $8.8 million gain on extinguishment[85]. - As of September 30, 2024, the total principal amount of Convertible Notes was $3.69 billion, with a net carrying amount of $3.64 billion after unamortized debt issuance costs[87]. - Total interest expense for the three months ended September 30, 2024, was $4.49 million, compared to $3.94 million for the same period in 2023, reflecting an increase of approximately 14%[89]. Restructuring and Workforce - The company completed a restructuring plan in Q2 2024, resulting in a global headcount reduction of approximately 10%[121]. - Total restructuring charges for the nine months ended September 30, 2024, amounted to $70,157,000[123]. - The company initiated a wind down of its AR Enterprise business, resulting in a 3% reduction in global employee headcount and $18.6 million in pre-tax restructuring charges[124]. Tax and Compliance - Income tax expense for the three months ended September 30, 2024, was $8.3 million, compared to $5.8 million for the same period in 2023[118]. - The effective tax rate for the three months ended September 30, 2024, was (5.7)%, compared to (1.6)% for the same period in 2023[173]. Strategic Investments - The carrying value of strategic investments as of September 30, 2024, was $188.6 million, down from $195.3 million as of December 31, 2023[108]. - Strategic investments recognized a net loss of $312,000 for the three months ended September 30, 2024, compared to a loss of $270,000 for the same period in 2023[110]. - Unrealized losses on strategic investments still held amounted to $372,000 for the three months ended September 30, 2024, compared to $400,000 for the same period in 2023[110].